Retailers Pleased: “Container Cliff” Averted

In Industry News, Reports, What's New by Jeff PrineLeave a Comment

container ship and loading crane in portWashington—The nation’s retailers applauded a tentative contact agreement reached late Friday between the International Longshoremen’s Association (ILA) and United States Maritime Alliance (USMX) that averted a port strike that would have shut down cargo containers. Had no agreement been reached and the ILA gone on strike at East and Gulf Coast container ports—the so-called “container cliff”—experts said it would have cost the U.S. economy more than $1 billion a day, according to the Associated Press.

“If the tentative agreement holds, the new labor contract will bring much-needed certainty and predictability to the supply chain for retailers, manufacturers, farmers and other industries that rely on the ports to move the nation’s commerce and trade,” said Matthew Shay, president/ceo at the National Retail Federation (NRF) which had urged both sides to negotiate a new contract. “The new port labor contract, which covers container operations the each of the 14 East and Gulf Coast ports, from Maine to Texas, will help make these major ports more competitive and efficient.”

The ILA, which represents 14,650 workers handling cargo nationwide, and the USMX, a group of container carrier companies and port associations along the East and Gulf coasts, have been in concentrated negotiations since last year and had postponed deadline a couple of times.

The biggest fear was that negotiations would break down and the ILA would strike crippling container cargo exports and imports to the Eastern United States. The NRF and other retail groups had even urged President Obama to intercede and invoke the Taft-Hartley Act should a strike occur.

No details of the tentative agreement were released “out of respect for the parties’ ratification process,” officials said. According to The New York Times, both sides reached a deal on their main point of dispute, which was focused on container royalty payments that shipping companies share with union members for each ton of cargo handled.

“We appreciate the leadership and outstanding public service of the Federal Mediation and Conciliation Service for their steadfast work with both sides–through thick and thin–since last September,” Shay added. “Again, we are grateful for this announcement and reiterate our request that both sides move quickly to ratify the final master contract.”


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